Cisco Wants Voice, Video Tech Firms in Its Shopping Cart

Apr 09, 1998

Cisco Wants Voice, Video Tech Firms in Its Shopping Cart

James Massa, Cisco director of operations

By Nick Wakeman

Emerging companies that specialize in voice and video technologies are high on Cisco Systems Inc.'s shopping list as the networking giant moves to add more of those capabilities to its commercial and government offerings.

The San Jose, Calif.-based company, which has made three acquisitions since January 1998 alone and 15 since January 1996, plans at least eight more acquisitions this year, company executives said.

Cisco President John Chambers wants to boost revenue from voice, video and data equipment from the current level of 30 percent to 50 percent of total revenues by 2001.

But Cisco's ability to integrate new technologies will serve it well as it competes with traditional voice networking providers, said Chris Stix, an analyst with the financial services company Cowen & Co. of Boston.

"They have certain advantages, like a quicker time to market with new products," Stix said. "Cisco has 40 or 50 products they are going to voice-enable this year."

But Cisco isn't likely to be on the buying end. "It doesn't make sense for Cisco to buy one of those companies, because they would not be bringing us anything new in the voice arena," Massa said.

In addition to saving networking costs, the convergence of voice, video and data in the federal market is being driven by rising government demand for video capabilities, industry officials said.

"Look at a military command. They want people talking to each other and showing things to each other," Massa said. The need for a multi-user video application is rare in the commercial market, but very common in the government, he said.

The government is adopting these capabilities faster than the commercial world, said Karyn Mashima, vice president of enterprise systems for Lucent Technologies.

"Conferencing and collaboration is less exciting [than other applications,] but over time they will become much more popular," she said.

Cisco has several projects under way in the federal government, including work to enable networks at the Defense Department, Federal Aviation Administration, Treasury Department, U.S. Postal Service and Veterans Affairs to handle voice, video and data, Massa said.

"The systems integrators are very important to us in this," Massa said.

"Integrators have to manage these networks," Massa said. "The more that is going across these networks, the more important it is to manage them effectively and do the value-added services that are required of the end users."

In this episode of the Project 38 podcast, we talk to Hitachi Vantara Federal leader David Turner about a project at Disney World that can teach the federal government how powerful the Internet of Things and data can be.
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